Write Off Debt with No Monthly Repayments
Debt Solutions, Debt Relief Orders, Going Bankrupt
Mar 4, 2009
According to National Debtline, calls have increased by 40% since 2007. Rising levels of involuntary unemployment, on the back of excessive consumer borrowing, have created a personal debt time bomb. Money problems can be tackled with a debt solution. It is possible for tenants to write off debt with no monthly repayments with either a Debt Relief Order (DRO) or by going bankrupt.
Write off Debt up to £15,000 with a Debt Relief Order
A Debt Relief Order is a new government debt solution designed to help low income families write off debt up to £15,000. The criteria is relatively strict and only those with a disposable income of less than £50 a month and collateral of under £300 will qualify. It only costs someone £100 to commence a Debt Relief Order.
An intermediary, who is a qualified debt counselor, will work with the debtor to ensure that they meet the strict Debt Relief Order criteria. The intermediary will help with any general advice and paperwork. It is designed to be a more straight-forward debt solution than going bankrupt.
Unless someone is the beneficiary of a windfall payment, such as a lottery win or inheritance, no monthly repayments will need to be made. From April 2009, those struggling with personal debt of up to £15,000 can write-off debt in just 12 months. If a debtor meets the criteria of a Debt Relief Order, it provides a better way to become debt-free than going bankrupt.
Write off Serious Debts by Going Bankrupt
Non-homeowners struggling with personal debts over £15,000 can choose to write off debt by going bankrupt. Most debtors will be discharged after just 12 months. This means that they will be debt-free, although it will make getting credit difficult for 6 years.
Going bankrupt requires someone with serious debt problems to work closely with the Official Receiver. They will perform a thorough investigation into all personal financial matters. It is expected that any disposable income is given to creditors, but most people going bankrupt make no monthly repayments as they are able to prove that no disposable income exists.
Those involved in reckless activity, such as share trading, may find that they are subject to a Bankruptcy Restriction Order (BRO). This can mean that someone going bankrupt isn't discharged for up to 15 years. Going bankrupt will also result in a notification of the insolvency being placed in the local newspaper as well as the London Gazette.
Tenants struggling with high levels of personal debt may be better off pursuing a debt solution, such as a Debt Relief Order or going bankrupt, rather than taking out another loan. Both of these debt solutions allow someone with money problems to become debt-free in just 12 months without further monthly repayments.
Home owners with personal debt problems may wish to consider an Individual Voluntary Arrangement. Those seeking to write-off debt may be interested in finding out whether they have an illegal credit card or unenforceable loan agreement. It is believed that millions of credit agreements are not legally enforceable.
 |
 |
 |
 |
 |
